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Foreign investor strategy development in the central and eastern European context
Author(s) -
Marinov Marin A.,
Marinova Svetla T.
Publication year - 1999
Publication title -
thunderbird international business review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.553
H-Index - 37
eISSN - 1520-6874
pISSN - 1096-4762
DOI - 10.1002/tie.4270410109
Subject(s) - bulgarian , context (archaeology) , resizing , internationalization , business , competition (biology) , foreign direct investment , east central europe , adaptation (eye) , international economics , market economy , international trade , economics , european union , political science , politics , paleontology , ecology , philosophy , linguistics , physics , macroeconomics , optics , law , biology
Investment conditions in the transition economies of Central and Eastern Europe favor long‐term strategic investments. Increasing competition pressures in the saturated West European beer markets coupled with shrinking demand challenged Interbrew SA, Belgium to enter the emergent prospective markets of Central and Eastern Europe by the acquisition of former state‐owned enterprises. The study of Interbrew's case shows the linkages existing between investor internationalization strategy, motives, strategy implementation, and adaptation in the highly volatile markets of Hungary and Bulgaria. This case represents a good example of slow reactive strategy development in the Hungarian environment leading the investor to the loss of its first mover advantage. Using similar motives for its acquisitions in Bulgaria, Interbrew has successfully implemented a proactive adaptation of its initial Central and Eastern European strategy to the Bulgarian environment. The lessons from the case can be used by foreign investors to increase their chances for success in FDI acquisition in transitional economies. © 1999 John Wiley & Sons, Inc.